Robert D. HormatsUnder Secretary for Economic Growth, Energy, and the Environment

National Economics University

Hanoi, Vietnam

March 21, 2012

Remarks as Prepared for Delivery

Thank you for the introduction and thank you for inviting me to talk about the green economy.

More than ever before, the wellbeing of our economy, the planet, and our energy security are inextricably linked. This connection hasn’t always been so obvious.

For much of the 20th century, businesses and governments typically focused on the allocation and optimization of their labor and capital resources for growth.

Their assumption was that natural and environmental resources were so abundant that they could be treated as “free” goods.

As a result of this logic, approximately one-third of the world’s biodiversity has been lost since 1970, three-fourths of the world’s marine fisheries are fully or over exploited, and two-fifths of the planet’s original forests are gone.

Business as usual is not a viable option. We need to revise our strategy going forward for the sake of our planet and for the continued success of our economies.

Transitioning to a green economy is an opportunity for businesses and governments to implement practices that are more responsible to our citizens, our planet, and budgets.

There are numerous examples of businesses and investors seizing opportunities to improve profitability through the adoption of environmentally-friendly practices.

The World Wildlife Fund (an international NGO) has partnered with The Coca-Cola Company since 2007 to conserve priority river basins around the world and integrate sustainability into Coca-Cola’s operations.

Water is the main ingredient in every one of Coca-Cola’s products. And, water is essential for the health of ecosystems and biodiversity.

Coca-Cola is on track to improve its water efficiency by 20 percent by the end of this year, compared to 2004. That means that they will have cut nearly 50 billion liters of water usage. This is a win, win partnership.

Value-added from sustainable business practices isn’t restricted to large corporations.

To demonstrate this, the State Department partnered with the World Environment Center and multinationals such as Walmart to help small and medium sized enterprises around the world improve their environmental performance, reduce costs, and improve efficiency and competitiveness.

Thirty-five small and medium sized businesses from Guatemala and El Salvador participated in the project to improve their environmental performance. They achieved a combined total savings of over $600,000 from an initial investment of approximately $300,000. That’s a very attractive return on investment, in addition to the environmental benefits.

These companies aren’t alone. More than 80 percent of Fortune 500 companies have created environmental charters and have adopted sustainability strategies because it helps their profitability.

Governments also have a role to play in driving private sector adoption of environmental technologies and investment in cleaner practices through financing and other fostering voluntary agreements, and by setting standards such as air and water pollution limits.

In addition, governments themselves have a responsibility to lead by example. That’s why, through the State Department’s Greening Diplomacy Initiative, we’re reducing energy consumption by consolidating our information technology platforms, lowering fuel costs by increasing the number of alternative fuel vehicles in our fleet, and improving the overall performance of our buildings.

Soon, approximately 45 percent of the energy delivered to the Department’s Washington, D.C. facilities will come from renewable sources. Similar to the private sector, the U.S. government simply cannot afford to waste energy.

The government of Vietnam has also made some promising strides on encouraging and adopting sustainable practices. Vietnam is an active partner with the United States, Cambodia, Laos, and Thailand in the Lower Mekong Initiative, which promotes regional cooperation in education, health, environment, and infrastructure.

Through the Initiative, we’re strengthening natural resource management in the region by building capacity and strengthening institutions.

And, Vietnam’s national “Payments for Forest Environmental Services” pilot project—with support from the United States—creates a mechanism to collect and distribute a portion of the economic value of ecological services provided by forests in the Lam Dong and Son La provinces.

The program provides incentives to landowners, farmers, and forest communities to better manage their land by assigning a value to Vietnam’s shared natural resource. Already, the program has helped protect over 210,000 hectares of threatened forest land and resulted in a 50 percent decrease in illegal logging and wildlife poaching in the Da Nhim watershed area.

Efforts like these are critical to drive our transition to a green economy, but it’s important to recognize that no one entity can do it alone. Neither the private sector, nor Vietnam, nor the United States. That’s why the United States is engaging the global community at Rio+20 to build greener and more inclusive economies, smarter cities, and to strengthen institutions and networks to address current and future challenges. Our approach to Rio+20 is focused on three key areas.

On the demand side, we are connecting the conservation of natural resources to profitability, thereby protecting the environment and freeing business resources for other types of job creating activities.

We’re working to catalyze private sector investment in green infrastructure projects in rapidly urbanizing areas because cities are major consumers of energy.

Second, ecosystem management and rural development are critical to secure the wellbeing of our natural environment. Agriculture is key in this context. To increase food yields and nutrition with fewer inputs and smaller impacts on the environment, we need both innovative agricultural technologies and improved understanding of agricultural systems.

That’s why we’re extending support for sustainable, agriculture-led growth that will help lift people out of poverty through the U.S.-led Feed the Future initiative.

Finally, we need to modernize our global institutions to be effective (and some might even say, relevant) in the 21st century. The Internet, social media, and other connection technologies allow us to transcend the walls of traditional institutions, fostering truly global collaboration.

By embracing twenty-first century connectivity, we can deploy the collective ingenuity and capability of governments, citizens, businesses, and civil society stakeholders from around the world to promote economic development and sustainable environmental practices.

In this context, we do not need new UN organizations; we need to make the existing structures more effective, efficient, and relevant to today’s world.

How we deal with this moment—whether we succumb to a zero-sum competition over increasingly limited resources or cooperate with each other to build green economies—will determine in large part the security and prosperity of America, Vietnam, and the world in the twenty-first century.